Independent auditors have found that the Selangor government had made “a sound commercial decision” in its debt recovery exercise involving Talam Corporation Bhd.

NONE “It was purely a debt settlement arrangement. (Audit firm) KPMG is of the view that Selangor made a sound commercial decision under the circumstances... at that point in time,” states KPMG’s report as read out by Selangor Menteri Besar Abdul Khalid Ibrahim (left) .

KPMG also found that, based on state records, the assets obtained from Talam “are sufficient for Menteri Besar Incorporated (MBI)... to recover Talam debts, with no debt waiver by MBI”.

Also present at the press conference today was Chan Siew Mei, executive director of KPMG’s advisory unit.

Chan said the review was conducted over a period of a month and that the scope was “strictly to check on transactions and supporting documents”.

“It was not to see if allegations (against the state) were true or not,” she said.

Asked if she had found instances where the value of land assets involved were lower than the debt it was to offset, she said: “The short answer is Yes.”

“But the details are answered in the (state prepared and KPMG-vetted) frequently asked questions (FAQ),” she said.

However, Abdul Khalid said that at no time was the state “shortchanged” as provisions were put in place to ensure that Talam would make up the difference if the land did not match the value of the debt.

‘FAQ to help MCA friends’

In the four-page FAQ, the question on overpriced assets was answered by saying that the audit found that the valuations “supported the gross consideration which was agreed upon by MBI”.

azlan “Hence the records showed no situations of assets being overpriced,” it reads.

According to the MB, the FAQ was put together to assist the media and public, “and your MCA friends” to understand the issue better.

He added that the report will be made public and tabled, alongside a White Paper on the matter at the November sitting of the state assembly.

“(KPMG’s) conclusion demonstrates that the debt recovery was legal, ethical, done in good faith and has in no way compromised the interest of the state, its subsidiaries or the people of Selangor,” he said.

He said that if MCA, which has asserted that the Selangor government was involved in a RM1 billion fiasco, still needs assistance to understand, they can consult any of the state’s four appointed spokespersons.

They are Petaling Jaya Utara MP Tony Pua, Selayang MP William Leong, Kuala Selangor MP Dzulkefly Ahmad and the MB’s political secretary Faekah Husin.

“If they don’t like Pua’s face, they can get a nice explanation from Dzulkefly or a female one by Faekah, or from a friendly lawyer by the name of William Leong,” he quipped.

He added that the state will proceed with legal action if MCA continues to assert that it was involved in a  scandal.

Comparison with Enron

In immediate response, MCA deputy minister Chua Tee Yong, who has been at the forefront of the attacks, said the audit result could be due to limited access to documents.

NONE He also referred to the Enron Corporation scandal involving an American energy company where auditors failed to uncover billions of debts and failed projects hidden by executives through accounting loopholes.

"(An) audit report depends on the scope of the work. Enron and a lot of (other) cases show that (an) audit and its results are limited to the documents available," he said in a tweet.

The details of the report should only be discussed further when it is made available to the public, he said.

"The White Paper is still long outstanding," he added.

VIDEO l 3.17 mins

FAQ on Talam debt recovery exercise